Suzhou Rural Commercial Bank(SH:603323) EBSCN·2025-10-30 12:29Investment Rating - The report maintains an "Accumulate" rating for the company [1] Core Insights - The company demonstrates strong resilience in profit growth and robust risk compensation capabilities, with a slight increase in net profit and stable revenue [4][5] - The bank's non-interest income has accelerated, contributing positively to overall performance despite pressure on net interest income [5][8] - The asset quality remains stable with a low non-performing loan ratio and a high provision coverage ratio, indicating solid risk management [9][10] Financial Performance Summary - For the first three quarters of 2025, the company achieved operating income of 3.22 billion, a year-on-year increase of 0.1%, and a net profit attributable to shareholders of 1.71 billion, up 5% year-on-year [4] - The annualized weighted average return on equity for the first three quarters was 12.03%, a decrease of 0.88 percentage points year-on-year [4] - The growth rates for net interest income and non-interest income were -3.8% and 7.9%, respectively, indicating a shift towards more reliance on non-interest income [5] Asset and Liability Management - As of the end of Q3 2025, the growth rates for interest-earning assets and loans were 9.7% and 8.7%, respectively, showing an acceleration in credit deployment [6] - Deposit growth has also accelerated, with a year-on-year increase of 7.1% in deposits, reflecting a trend towards more term deposits [7] - The net interest margin (NIM) is under pressure, with a decline of 3 basis points compared to the first half of the year, influenced by competitive pricing and demand factors [8] Capital Adequacy and Risk Management - The bank's capital adequacy ratios remain robust, with a core Tier 1 capital ratio of 10.76% and a total capital adequacy ratio of 12.88% as of Q3 2025 [9][10] - The provision coverage ratio stands at 355.9%, indicating a strong buffer against potential loan losses [9] Earnings Forecast and Valuation - The earnings per share (EPS) estimates for 2025-2027 have been adjusted to 1.00, 1.05, and 1.11 yuan, respectively, reflecting a cautious outlook on revenue growth [10] - The current price-to-book (PB) and price-to-earnings (PE) ratios suggest the stock is undervalued, with PB ratios of 0.53, 0.48, and 0.45 for the next three years [10]